Responsible Funds, Sept. 25: RobecoSAM, AGF Investments, IFFIm, RWC, Erste AM

The round-up of the latest responsible funds news

RobecoSAM, the sustainable investment boutique, made a series of announcements at its annual forum in Zurich this week. A new ‘Smart ESG’ methodology, which identifies sustainability information as an investment factor, was launched. Also unveiled were two new investment solutions that focus on children’s rights and corporate gender equality.

German renewable fund provider CHORUS Clean Energy has re-started its initial public offering (IPO), pricing its shares today (September 25) at €9.75-12.50. Trading is to begin on Frankfurt on October 7. CHORUS had originally planned to do its IPO in early July, but postponed the event due to market turbulence caused by this summer’s Greek crisis. The company said it was offering up to 12m shares to net around €125m.

Both ESG and Islamic investors and have helped a new Islamic “vaccine” bond raise $200m. The International Finance Facility for Immunisation Company (IFFIm) issued its second Sukuk (Islamic bond) for children’s immunization through Gavi, the Vaccine Alliance. It follows the body’s inaugural Sukuk in December 2014. The three-year issue, coordinated by Standard Chartered Bank, with joint lead managers Emirates NBD Capital, Maybank, National Bank of Abu Dhabi and NCB Capital, was 1.6 times oversubscribed. “This Sukuk brings together two rapidly growing fields: Islamic Finance and Socially Responsible Investing,” said Doris Herrera-Pol, Global Head of Capital Markets at the World Bank, IFFIm’s Treasury Manager. Announcement

The RWC Nissay Japan Focus Fund, a concentrated fund specializing in shareholder engagement from UK fund firm RWC, has reportedly raised $150m since its launch in March of this year. Institutional investor said
the UCITS offering, which resembles the Dublin-domiciled Japanese Stewardship Fund, is run by the same team headed up by fund manager Yasu Kinoshita. The report quoted Head of Business Development James Tollemache as saying demand had come from UK and continental European investors “and an increasing amount of global institutional investors given the long-term nature” of the investment process. He also mentioned the corporate environment improved by the launch of the Japanese Stewardship Code, the JPX-Nikkei 400 Index a new Corporate Governance Code.

Michael Queen, former Chief Executive of UK venture capital firm 3i Group, has reportedly teamed up with former Deutsche Bank AG analyst Bertrand Lecourt on a waste and water venture. The Wall Street Journal said Aquilys Investment Management has gained approval from the Financial Conduct Authority. Home page

Vienna-based Erste Asset Management says it will merge two of its environmentally friendly funds to create a new product targeted at institutional investors. Its WWF Stock Umwelt and WWF Stock Climate Change offerings will combine into the new WWF Stock Environment – and start with €80m in assets. The manager of the fund, which invests in small- to midsize firms active in the renewable sector, is Clemens Klein. A unique feature of WWF Stock Environment is that some of fund’s assets help finance climate protection projects sponsored by the World Wide Fund’s Austrian chapter.

Farmland Partners, the Denver-based, New York-listed farmland company has filed a prospectus with the Securities and Exchange Commission under which it may sell common stock worth $25m. Net proceeds will go to future farmland acquisitions.AGF Investments, the Toronto-listed fund firm with more than C$33bn under management, says its AGF Global Sustainable Growth Equity is the first strategy in Canada to publicly disclose its environmental footprint. The disclosure covers a range of environmental factors, including carbon emissions, greenhouse gases, water usage, waste, land & water pollutants, airs pollutants and natural resource usage. “Given the solutions-based focus of our mandate, we are keenly interested in tools that help us understand and improve the portfolio’s environmental footprint,” said Martin Grosskopf, Vice-President and Portfolio Manager. The move was welcomed by Deb Abbey, CEO of the Responsible Investment Association (RIA).

Former tennis star Andre Agassi is getting into impact investment. His Agassi Ventures has teamed up with Turner Impact Capital to launch the Turner-Agassi Charter Schools Facilities Fund II (Turner-Agassi II), which plans to invest $1bn in the development of up to 130 schools in deprived areas across the US by 2020. Investors in Turner-Agassi II include the University of Michigan, the Texas General Land Office, Citi Community Capital, and a diverse group of institutional investors and family foundations. Link

New research by the University of Edinburgh Business School, based on analysis of 1,400 funds, has found that environmentally friendly funds have significantly outperformed “black funds” – which invest in fossil fuels – by more than 14% over the period 2012 to 2014. The research has also found that green funds delivered comparable returns to mainstream investment funds over the same period. The study cites governmental support for green energy as a potential driver of investment rather than motivation being founded on solely ethical grounds. Link

Onyx Renewable Partners, the US renewable energy development company established by funds managed by private equity firm Blackstone Energy Partners, has announced that it has entered into partnership with Credit Suisse to invest over $300m to ‘develop, own and finance commercial and industrial sector solar generation projects’ across North America.

A social investment fund for Ghana financed in part by oil producers will provide $3.12m worth of micro-loans to the nation’s farmers, according to Ghana Business News. Backers of the fund are the Arab Bank for Economic Development and a development fund created by members of the OPEC oil cartel. The loans, which will have an average size of $1,000, will finance infrastructure for farmers of, among other things, maize, corn, livestock and fisheries, the paper said. Link

The UK’s Green Investment Bank and John Laing have committed £48m (£21m and £27m, respectively) in equity to a new £138m renewable energy facility in North East of England, with the remaining funding being provided by Barclays as debt.

Three US pension funds have reportedly committed over half of the funding for a new $1bn timber investment partnership. Reuters, citing forestry firms Plum Creek Timber Company and Silver Creek Capital Management, said Washington State Investment board has committed $300m, the Oregon Public Employees Retirement Fund $200m and the Alaska Permanent Fund Corporation $100m to the Twin Creeks Timber joint venture.

Index and ESG firm MSCI has reported a significant rise in demand for Environmental, Social and Governance (ESG) data and indexes, with equity exchange traded fund (ETF) assets tracking MSCI ESG Indexes growing by nearly 30% to $1.8bn, as of July.